Bullock on No. 1 thing Dems must do in rural America

With help from Jason Huffman, Ian Kullgren and Helena Bottemiller Evich

BULLOCK ON NO. 1 THING DEMS MUST DO IN RURAL AMERICA: Montana Gov. Steve Bullock, a Democrat, is uniquely qualified to offer his party guidance on how to handle future elections in the heartland in the Trump era: He won re-election last year by four percentage points in a state where Donald Trump cleaned up, winning by 20 points. Trump took the rural vote by a two-to-one margin on his way to the White House, so as Democrats strategize for the future — fresh off selecting a new DNC head over the weekend — Bullock says they need to work the map — all of it.

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“I think rule number one in anything is showing up,” he told Pro Ag’s Helena Bottemiller Evich at POLITICO’s State Solutions event in D.C. on Friday. “And we, as Democrats, need to be showing up on a heck of a lot of places other than just the East and the West Coast.”

Bullock mentioned Manhattan, Mont., a city with a population of little more than 1,500 as of the last census. “You know, the hopes and dreams of somebody in Manhattan, Montana, aren’t that much different than in Manhattan, Kansas, or in Manhattan, New York,” he said, adding: “If we focus on those shared values, because so many of those shared values also translate directly to economic issues, as well, I think there’s a lot more and a lot better we’ll be doing next time around.”

HAPPY MONDAY, FEB. 27! Welcome to Morning Ag, where the award for least-prepared Oscar watcher goes to your host, who has not seen one of this year’s nominated films. I’ll spare you the list of excuses … err, acceptance speech. You know the deal: Thoughts, news, tips, Oscar pool winners? Send them to jhopkinson@politico.com or @jennyhops. Follow the whole team at @Morning_Ag.

THIS WEEK: TRUMP ON THE BUDGET, TRUMP ON THE HILL: The White House is expected to send its preliminary funding targets for 2018 to federal agencies today, asking for a big-time increase in military spending, POLITICO reported. Trump does not want changes to major entitlement programs, including Social Security and Medicare, but many non-defense agencies are facing cuts. Trump wants billions of dollars in reductions to the EPA and State Department budgets, The New York Times reported, adding: "Social safety net programs, aside from the big entitlement programs for retirees, would also be hit hard."

Office of Management and Budget spokesman John Czwartacki told The Associated Press that Trump's final budget proposal — expected in mid-March — would take into account only agency operating budgets funded by Congress. "Proposals on tax reform and so-called mandatory programs — they include food stamps, student loans, health programs and farm subsidies — will be released later," the AP added.

It's about to get busy in the House: At the top of the agenda for farm groups will be the House Agriculture Committee’s day in session on Tuesday, during which members will tackle two key — albeit technical — farm bill programs. The Subcommittee on Conservation and Forestry is set to meet at 10 a.m. to look at potential changes to conservation policy in the 2018 reauthorization. Then, at 2 p.m., the Subcommittee on Livestock and Foreign Agriculture will gather to look at what can be done to improve international market development programs. Witness lists have not been released, so stay tuned for details.

More on the budget: On Wednesday morning the full committee will gather for a business meeting to review its budget views and estimates for the department and programs under its jurisdiction. The committee’s recommendations will be used by the House Committee on the Budget as it looks at which programs it should authorize funding for in fiscal 2018. Meeting details here.

Trump’s big speech: The new president will give his first address to a joint session of Congress on Tuesday night. Expect talk about the administration's budgetary priorities as well as on immigration and trade, given the White House’s recent moves. And perhaps the president may direct a few words at why the Senate hasn't quickly confirmed his Cabinet-level nominees, including his pick for Agriculture, Sonny Perdue.

Also happening this week:

— Today: Vote on Ross to be Commerce boss: The Senate is set to vote at 7 p.m. on the nomination of Wilbur Ross to be Commerce secretary. Afterward, they’ll vote to limit debate on the nomination of Rep. Ryan Zinke (R-Mont.) to be Interior secretary.

— House appropriators will look at the Farm Credit Administration. The Appropriations Committee’s agriculture sub-panel will chat with Dallas Tonsager, FCA’s chairman and CEO, during an oversight hearing Tuesday at 10 a.m.

— USDA takes advice on the future of agriculture. The Trump administration, it seems, is looking for guidance on what it should plan for regarding farming systems for decades to come. USDA will hold a listening session Thursday on “Visioning of United States Agricultural Systems for Sustainable Production.” According to the Federal Register notice it published on Jan. 24, just days after the administration took power, the department is looking for input on how to ensure the “long-term health and viability of U.S. agriculture and for concurrently improving the economic, environmental, security, and health benefits to the U.S. through agriculture over the next 50 years.” The session will be held at the Whitten Building, 12th St. and Jefferson Drive SW, starting at 8:30 a.m. Details here.

— Hemp gets its day on the Hill. The industrial hemp industry and its supporters will be making their argument for legalization again this week. A quick recap in case you haven’t been following the fight: For the past several years, some farmers and farm advocates have been eyeing industrial hemp as a potential option for planters seeking a new cash crop, especially in former tobacco production areas of Kentucky and Colorado.

They got a huge win in the 2014 farm bill when Senate Majority Leader Mitch McConnell included a provision that made cultivation of the crop legal for university or state research purposes. But hemp is technically still on the Controlled Dangerous Substances list, making it difficult for farmers to get seed, among other things. The industry has long called for full legalization of industrial hemp, and more than 100 growers, processors and other supporters will make that case to lawmakers in Hill visits on Wednesday.

But first, on Tuesday, the Hemp Industry Association is holding what it has dubbed the Hemp Products Expo in the foyer of the Rayburn House Office Building, starting at 10 a.m.

— Don’t forget the Alamo. Commodity Classic, the annual gathering of corn, soybean, sorghum and wheat growers, will take place in San Antonio, Texas, starting Wednesday. If you’re headed there, expect a lot of chatter about farm bill priorities and a lot of questions about what President Trump’s policies on immigration and trade will mean for farmers. House Agriculture Chairman Mike Conaway (R-Texas) will continue his farm-event speaking tour with remarks in San Antonio on Friday morning, following his appearances at the Southwest Ag Issues Summit and USDA’s Outlook Forum. The full agenda is here.

ROSS’ SIDE PROJECT: MAKE AMERICA FIRST ON SEAFOOD: Wilbur Ross is expected to emerge as the Trump administration’s leading voice on trade after the Senate votes tonight to confirm him as Commerce Department secretary. He’s already singled out a surprising pet project: Reducing America’s reliance on seafood imports.

“Given the enormity of our coastlines, given the enormity of our freshwater, I would like to try to figure out how we can become much more self-sufficient in fishing and perhaps even a net exporter,” the 79-year-old billionaire businessman said at his confirmation hearing in January.

That would be a big job for anyone, since 85 percent, or some $20 billion, of seafood consumed in the U.S. comes from abroad. America is the second-largest seafood market after the 28-nation European Union, and the U.S. seafood industry runs an $11 billion trade deficit.

One action Ross could take to curb the amount of seafood the U.S. imports each year is to follow through on the Seafood Import Monitoring Program, which the Commerce Department's National Oceanic and Atmospheric Administration establishedduring the waning days of the Obama administration. That regulation, supported by environmental groups like Oceana, is aimed at reducing billions of dollars in illegal, unreported and unregulated fishing each year by creating a traceability program to track imported seafood from point of harvest to point of entry in the U.S. Pros, Doug Palmer dives into Ross’ fishing expedition here.

SCUSE: SUGAR PROGRAM IS GETTING ‘MORE COMPLEX’: The controversial U.S. sugar program, viewed as protectionist by many sugar-exporting countries, could be a target in the next farm bill if the industry doesn’t work collaboratively toward shared goals, Michael Scuse, former USDA undersecretary for farm and agricultural services, warned at USDA’s 93rd Annual Outlook Forum on Friday.“It’s not been easy for us over the last eight years to manage the program,” Scuse said. “As time goes by, it’s becoming more complex to manage.”

Under the sugar program, if prices are depressed and growers can’t sell enough to pay off loans, the government is forced to buy the surplus at taxpayers’ expense. Scuse told industry officials that such forfeitures in the future could put scrutiny on the program in the next farm bill, especially with the $260 million the government has already paid in recent years. “I think if that would happen, the industry would come under attack,” he said.

“Cool heads” will also need to prevail in sugar trade with Mexico to keep prices level, Scuse said. The Obama administration had worked right up to the end of its tenure in an effort to improve an agreement suspending U.S. retaliatory tariffs on Mexican sugar. U.S. refiners say the deal is not working, as Mexican producers are finding ways around strict import restrictions on refined sugar by exporting product that is technically raw but can still be used directly in food production or consumption with minimal processing. Terminating the deal would result in high anti-dumping and countervailing duties, which could roil the U.S. sugar market and put more negative attention on the program.

“I am hopeful that, when we get the teams in place and negotiations start, that clear, cool heads will prevail and that we’re going to be able to have a suspension agreement over a period of a couple of years that is going to work for everybody,” said Scuse, now Delaware’s agriculture secretary.

To Russia (and back) with love: Scuse also spoke longingly of a time when U.S. agricultural producers saw untapped potential in the Russian market. Speaking during the same Outlook Forum panel, he said the best trade mission he led was in Dec. 2012 to Russia where U.S. producers were able to do $6 million in sales over the course of a few days.

“We were headed down a great trade road until this little incident in the Crimea took place and stopped all the trade,” Scuse said, referring to Russia’s incursion into Crimea and subsequent annexation of the former Ukrainian territory in 2014.

RMA LOOKS TO MAINTAIN, EXPAND CROP INSURANCE: Sticking with Outlook, Mike Alston, associate administrator of USDA’s Risk Management Agency and deputy manager of the Federal Crop Insurance Corporation board, told attendees that he has his eye on two priorities as he looks at the crop insurance landscape. “We do a very good job with this public-private partnership. We want to maintain that high standard,” he said. “The second thing we want to do is [ask], ‘Are there areas of program expansion where we need to look?’ And that comes from the ground up, from local communities, from grower groups, saying look we have this particular commodity, this particular niche market out there, what can RMA do?”

Whole farm insurance is starting to catch on: While we’re here: Data that RMA shared at Outlook shows insurance aimed at covering more diversified farms, known as whole farm insurance, has just about doubled in total liabilities over a year’s time. That type of policy is now the sixth most popular, but accounts for $2.3 billion, or just 2.3 percent, of total liability, according to RMA’s summary of business data. Corn alone accounted for $39.6 billion in liability in 2016.

Side note: Which state has the best apples? Well, Alston has some thoughts. Some falsely claim it’s Washington state, he said jokingly in an interview with Pro Ag’s Helena Bottemiller Evich, a proud Washingtonian. “I think the rest of the country knows that the best apples in the world come from the state of Michigan. Washington just had this propaganda. That’s my story and I’m sticking to it!” (We’re pretty positive there are some people in Washington and New York State who would beg to differ!)

CAGE-FREE SHORTAGE STILL LOOMING: Also, Hongwei Xin, director of Iowa State University’s Egg Industry Center, said on Friday that the egg industry will have to throw down $9 billion to $10 billion to remedy a shortage in cage-free eggs set to kick in in 2025. That’s mostly due to the shortage of housing available while a number of grocers — including Wal-Mart — have cage-free pledges scheduled to take effect.

KEANE TO LEAD ABA’S GOVERNMENT AFFAIRS: Kevin Keane has been promoted to executive vice president at the American Beverage Association, where he’ll lead the newly combined government and public affairs departments. “Under his leadership, ABA’s GPA team is continuing to lead on major initiatives to reduce sugar and calories consumed from beverages in the American diet, while combating discriminatory taxes and regulations and preserving consumer choice,” ABA said in an email. Keane was previously a top aide to former Wisconsin Gov. Tommy Thompson. He also served under Thompson during the latter’s time as HHS secretary.

MA’S INSTANT OATS:

— That stat you always hear about needing to double ag production to feed the world? It might be pretty off-base, according to a recent study.

** A message from the National Confectioners Association – #AlwaysATreat: We’ve always created transparent, fun, and great-tasting treats. By 2022, Mars Wrigley Confectionery, Nestlé USA, Ferrero, Lindt, Ghirardelli, Russell Stover, and Ferrara Candy Company will work together to make half of their individually wrapped products available in sizes that contain 200 calories or less per pack. And, 90 percent of the best-selling treats made by these companies will have calorie information printed right on the front of the pack. During the same time period, the newly established AlwaysATreat.com will evolve into a digital resource full of easy-to-use information for consumers to better understand the unique role that chocolate and candy can play in a happy, balanced lifestyle. Learn more at AlwaysATreat.com. **

About The Author

Before joining POLITICO, she spent three years at Inside Washington Publishers reporting on the EPA with a focus on chemicals policy, pesticides and water issues. Prior to that, Hopkinson was a reporter for The (Salisbury, Md.) Daily Times where she followed local governments as they tackled falling tax revenues and stagnating rural development, in addition to playing almost every mini-golf course in Ocean City, Md., in the name of a feature story.

Hopkinson earned her bachelor’s degree in journalism at the University of Maryland. She lives in Washington, D.C.